Hedge funds as measured by an S&P overall index returned 0.90% in June and finished the year's first half up 0.13%, Standard & Poor's said Friday.
All three of the index's subindexes rose in June.
"Managers have become less risk-averse due to a combination of more predictable monetary policy and contained inflation," Charles Davidson, a senior hedge fund specialist at Standard & Poor's, said in a press release. "This has encouraged greater confidence in asset allocations toward higher-yielding risk assets and increased leverage to generate target returns."
The S&P Directional/Tactical Index gained 1.62% in June as global equity markets rose. The S&P Arbitrage Index gained 0.24%, led by convertible arbitrage, which has had a difficult time coping with investor redemption selling, low volatility, tight credit spreads, and low issuance.
And the S&P Event-Driven Index gained 0.85% as its three underlying strategies - merger arbitrage, special situations, and distressed - all ended the month in positive territory.
